Ultra-low cost airline Spirit Airlines has filed bankruptcy. The pioneer behind super low fares in the U.S. combined with fees for everything hasn’t had the product or route network that customers have wanted since the pandemic, has seen their labor costs rise significantly, and has faced a fleet with engine issues.

According to data from aviation analytics company Cirium, Spirit Airlines has an all-Airbusfleet of 213 planes, with 182 in service and 32 in storage. Their average age is 5.8 years.

They have been severely affected by Pratt & Whitney’s geared turbofan engine issues. Currently 24 of their stored planes have these engines (which are on 55% of their fleet). In a recent earnings call Delta suggested that they were better-positioned for priority in dealing with such issues because of their size and importance as a customer.

Spirit saw an opportunity to sell themselves to Frontier Airlines, their main counterpart in low fares and high fees, but JetBlue came in offering a great deal more money. The Biden administration blocked that deal, believing it would reduce the amount of flying in the ultra-low cost carrier space. That’s the result we’re getting anyway.

With their bankruptcy filing, they’ve laid out the changes they believe are necessary to turn around the airline’s performance. And it’s taking further the notion that they need a different product to appeal to today’s consumers, especially in an environment of higher costs. They plan free wifi; free water and snacks for all; and improved customer service. They’re also planning improved upgrades for elite frequent flyers.

In the coming weeks they are planning loyalty program and credit card benefit changes, progress on their premium check-in, kiosk and bag drop airport experiences, and changes to their subscription Saver$ Club.

I’ve written that even though they’ve already dropped scores of routes, there will be more changes to their flying coming.

• We can expect to see more “less than daily” flying – so instead of a flight to a city every day, they’ll fly on peak travel days and won’t fly when they aren’t filling planes at sufficient fares.
  
• They’ll also alter their schedule for greater seasonality – again, flying when demand makes them profitable and eliminating flights at times of year that aren’t profitable.
  
• They’re said to be planning to do less flying out of major airline hubs where they face huge competition, and more flying from Fort Lauderdale.
  
• Spirit is following recent moves made by Frontier for more ‘out and back’ flying, which keeps flight cancellations and delays from spreading across their system.
  
• And, like Southwest, they’re planning to add airline partnerships. Spirit doesn’t fly long haul, and can’t take their customers to those places or sell tickets to them. They also don’t benefit from connecting traffic brought by airlines that do. This adds costs and complexity (such as interlining baggage), but focuses instead on revenue.

Spirit also wants to install seat power and larger overhead bins, as well as extra legroom coach seats.

The problem here is that Spirit’s model has been offering low fares at the lowest cost. Their costs are up, so they need to chase revenue. But they’re not going to be as good at that as Delta or United – because they offer neither the product nor the network. Taking a “me too” approach makes them at best JetBlue, which has underperformed the industry even with a significant head start.

It will be interesting to see how much of these changes that are part of the airline’s transformation plan actually come to pass. Another possible outcome is acquisition – perhaps, again, by Frontier. If that happened, we’d presumably see a less premium approach (Frontier doesn’t offer a domestic first class or wifi, for instance) and is doubling down on its low cost strategy rather than abandoning it.

It’s unclear why talks between Spirit and Frontier broke down. Perhaps Spirit wanted something for shareholders, and all Frontier would do is something like ‘$1 and assumption of debt,’ or perhaps Frontier sees a better opportunity to acquire the assets in bankruptcy with bondholders taking a haircut.